Worried About Capital Requirement Directive IV Submissions?

With the mandated Common Reporting (COREP) and Financial Reporting (FINREP) reporting regulations coming into effect, banks are faced with generating reports in XBRL (eXtensible Business Reporting Language) format.

The conversion of large data sets of capital, exposure and risk data into XBRL is not trivial, and it requires automated validation and testing that is beyond the scope of many reporting systems.

CoreFiling Seahorse® is an accurate and easy to use solution to help you create XBRL-compliant documents, without the need to understand the intricacies of XBRL.

Deployed on secure cloud servers, with simple access through your browser, the software lets you generate Microsoft Excel® spreadsheets directly from the European Banking Authority (EBA) specifications for COREP and FINREP.

The European Banking Authority (EBA) reporting regime, under Capital Requirements Directive (CRD) IV, came into effect on January 1, 2014.

The Financial Conduct Authority (FCA) has mandated the submission of Common Reporting (COREP) and Financial Reporting (FINREP) data to be in XBRL (eXtensible Business Reporting Language) format.

Official EBA remittance dates for COREP:

The first monthly liquidity reports with reference dates as of March 31, 2014, and April 30, 2014, must be filed by June 2014.

The first quarterly reports on own funds, large exposures, leverage ratio and net stable funding ratio with reference dates as of March 31, 2014, must be filed by the end of June 2014.

Remittance dates for FINREP and Asset Encumbrance have been extended:

The first quarterly FINREP reports for the period ending September 30, 2014, must be remitted by November 11, 2014.

The first quarterly Asset Encumbrance for the period ending December 31, 2014, for all entities, must be remitted by February 11, 2015.

Detailed filing requirements are set out in complex taxonomies which are still being and will continue to be revised by the authorities, adding uncertainty to the technical implementation by regulated firms.

The dependencies created by expanded filing, the introduction of XBRL and the continued development of the XBRL technical filing requirements, make compliance with the new regime a tough challenge.

Analysis

The new prudential reporting mandates require you to file your returns in XBRL.

The conversion of large data sets of capital, exposure and risk data into XBRL is not trivial, and requires automated validation and testing that is beyond the scope of existing (and many new to market) reporting systems.

Challenges include:

Impact on systems. Many financial institutions do not have secure and tested solutions in place, despite having made significant investment in updating systems and processes.

Impact on data. Many institutions will be unaware whether their underlying data, or template validation, fully meet the exacting COREP standards until the data is validated following submission by the regulator. This can leave the filer exposed, with no easy way to detect and correct the error—and open to regulator scrutiny.

Impact on people. Some banks have underestimated the impact on their “business as usual” teams of clearing data validation issues, reacting to updates of the templates and taxonomies, and the sheer operational load of managing and attesting up to 100,000 data points.

Recommendations

To help reduce your regulatory burden, consider a proven XBRL software solution with the support of Accenture risk and regulation professionals.

Have access to as much or as little operational support as required, provided by teams with hands-on experience implementing regulatory data models and all aspects of XBRL production.

CoreFiling Seahorse® is an accurate and easy to use solution to help you create XBRL-compliant documents, without the need to understand the intricacies of XBRL. The software:

Is deployed on secure cloud servers for immediate use, with simple access directly from your browser.

Generates Microsoft Excel® spreadsheets directly from the EBA specifications for COREP and FINREP (i.e. templates are produced from the latest version of EBA Taxonomy at the point of use).

Automates the conversion of compliant forms to XBRL, including support for and updates to the EBA blacklist of “rules to ignore.”